UPDATE 1-Oxford Instruments makes $254 mln bid proposal for Andor

LONDON Nov 12 (Reuters) - Britain's Oxford Instruments
, has made a bid proposal of around 159 million pounds
($254 million) for Andor Technology in an announcement
which the target company described as "premature" and
"unhelpful" given ongoing talks.

Oxford Instruments, which designs and manufactures tools for
industry and research, said on Tuesday it planned to offer 500
pence a share in cash for Andor to gain its expertise in
scientific digital cameras.

That is around 25 percent above Andor's closing share price
on Monday and boosted shares in both companies.

However, Oxford Instruments reserved the right to make an
offer on less favourable terms, and Andor said there was too
much uncertainty for it to consider the bid properly - although
it was willing to continue talks in an effort to reach a deal.

"The Board of Andor is disappointed that, having only made
the indicative proposal on 8 November, Oxford Instruments has
chosen to make today's announcement which the Board of Andor
considers to be premature and unhelpful in light of ongoing
discussions," Andor said.

At 0855 GMT, Andor shares were up 23.25 percent at 485
pence, their highest level since June 2012, while Oxford
Instrument's were 10.5 percent higher at 1,354 pence.

Andor said that since it first received an indicative cash
offer on July 9 from Oxford Instruments, the two had cooperated
and met multiple times.

Under UK takeover rules, Oxford Instruments has until 1700
GMT on Dec. 10 to make a firm offer or walk away.